What does a fraud analyst do?

What is a Fraud Analyst?

A fraud analyst investigates forgery and theft within customer accounts on behalf of a bank or a financial institution.

They track and monitor a bank’s transactions and activity that comes through individual accounts, identify and trace any suspicious or high-risk transactions, determine if there is improper activity involved, and determine if there is any risk to the bank or its customers.

What does a Fraud Analyst do?

A fraud analyst is responsible for observing various customer transactions to flag or identify suspicious activity. Most accounts and customers have banking patterns that typically do not change over the long term. Any transactions or series of transactions that do not fit the expected activity generate a 'red flag', and will be looked at.

If any suspicious transactions are found, the fraud analyst will flag the account and keep it suspended until it can be checked and verified. Transactions can be looked at for any number of reasons: transaction type, transaction amount, unusual transfers to unlikely partners, places where transactions originate, or a flurry of activity beyond the accepted norm for the account.

For any suspicious transactions, the analyst will try to obtain information that can support the origin of the transaction. For fraudulent items, this information can bear out who perpetrated the fraudulent item and is responsible for the criminal activity in question.

The analyst will contact the bank branch, the account holder, and any other intermediate parties that may have come in contact with or handled the questionable item. They are responsible for keeping any collected information confidential while working to catch the criminal(s) who may have committed the felony.

Models for analyzing fraud are kept within the bank’s regions. This can help determine patterns of fraud over certain areas, and break down larger criminal rings responsible for fraud activity. This can also help to identify certain holes in security that can be targeted over time, so that the bank can identify system improvements that can be made to eliminate the risk of fraud or reduce the ways in which it can occur.

What is the workplace of a Fraud Analyst like?

Fraud analysts can be found working in a variety of fields, such as finance, banking, insurance, municipal, state, and federal law enforcement.

They will typically be in a regional or central office where they can monitor activity from multiple sources at once. Specific software tools are used to help fraud analysts detect fraud and prevent it from occurring, or for reporting security threats and suspicious activity quickly.